Long term wage stagnation trend reversed in 2016: Cabinet

Taipei, May 14 (CNA) Taiwan has shaken off 16 years of wage stagnation from 2000 to 2016 and begun to see a notable increase in wages that has pushed average real earning to a new high, Vice Premier Shih Jun-ji (施俊吉) said Monday.

Last year, average real earnings received by employees in Taiwan from both regular-based income and irregular payments -- including overtime pay, year-end bonuses, performance bonuses, and full attendance rewards -- reached a record high of NT$47,271 (US$1,579), Shih said.

There were several reasons why wages stagnated from 2000-2016, a year in which average real earnings of NT$46,422 was lower than the NT$46,605 recorded in 2000, Shih said at a press conference held by the Cabinet to unveil its proposals to address the issue of persistent low wages.

The vice premier blamed wage stagnation on globalization which equalized the wages of workers across countries, the over-expansion of Taiwan's higher education institutions that effectively devalued educational qualifications and the methodology used to calculate real earnings, Shih said.

Shih said the inclusion of salaries for migrant workers in the calculation of average real earnings "dragged down the average level because their salaries are lower."

The number of migrant workers in Taiwan reached 625,000, or 8.4 percent of the employed population, in 2016.

Most migrant workers in the industrial sector covered by the Labor Standards Act earn the minimum wage of NT$22,000 a month, while most household caretakers earn only NT$17,000 a month.

Shih said that the trend in real wage growth in Taiwan is better reflected if salaries for migrant workers are excluded from the calculation.

As an example, the vice premier said that average real earnings last year for Taiwanese employees alone was NT$49,876, as opposed to NT$47,271 if migrant workers salaries are included.

In terms of average real rewards -- made up of average real earnings, insurance premiums paid by employers, pension reserves deposited by employers, severance pay and other benefits -- the figure for Taiwanese employees alone was NT$58,931 last year, compared to NT$54,966 if migrant workers are included, Shih said.

Shih's criticism of the calculation formula was characterized by the Chinese-language United Daily Evening News as "nonsense."

In response, Cabinet spokesman Hsu Kuo-yung (徐國勇) said that what Shih meant to say was that the statistics failed to highlight increases in average real wages over the years because of the possible impact of including migrant worker salaries in the calculation.

At the same time, increasing the wages of migrant workers and protecting their rights and benefits is a part of the government's policy objectives Hsu said, though he did not elaborate on plans to achieve those goals.